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Despite reports to the contrary, BT assures us that their Fusion product is alive and well. Still, they do admit that it's been something of a learning experience, and that they're testing a revamped service.

The idea behind Fusion was solid enough; a mobile phone which connects over Bluetooth to use the fixed line when in the home. Later Wi-Fi was used in place of Bluetooth, which gave greater range and meant that Fusion users could also make cheap calls when they were within range of a BT hotspot.

The problem is that cheap calls aren't as compelling as they used to be, and the same functionality is available from Truphone and similar, only with free calls and a wider choice of handsets. Fusion has apparently signed up 45,000 customers so far, well short of the millions the company was predicting back in 2005.

The concept of switching to local connections, using VoIP over broadband, is valid, but the technology has been a long time coming and making it simple for users has been a challenge. Femtocells should provide the simplicity, working with any GSM handset, and are being trialled by several operators around the world.

But shipping voice over the wireless networks has become so cheap that just offering discounted calls isn't enough, and it will be data services that can really take advantage of the increased speed, and reduced cost, of local connections. In trials of broadcast mobile TV 40 per cent of viewing is done in the home, content which could be provided much more cheaply over ADSL lines connected to Femtocells.

BT's next Fusion device will feature a keyboard and integrated data services, to properly take advantage of the faster connections where they're available. While voice may have become a commodity fast data is still expensive, and BT will be hoping to have their revamped service launched before that changes. ®